NEW YORK CITY (dpa-AFX) - JPMorgan Chase & Co. (JPM) agreed to pay $388 million to settle a suit by investors who claimed the bank misled them about the safety of $10 billion worth of residential mortgage-backed securities it sold before the financial crisis.
Robbins Geller Rudman & Dowd LLP announced a $388 million recovery on behalf of a class of investors in nine 2007 residential mortgage-backed securities or MBS offerings issued by JPMorgan- bringing to a successful conclusion one of the last remaining MBS purchaser class actions arising out of the global financial crisis.
Lead plaintiffs and court-appointed class representatives Laborers Pension Trust Fund for Northern California and Construction Laborers Pension Trust for Southern California played a key role in achieving the remarkable result, said Robbins Geller partner Luke Brooks, one of the lead attorneys on the case.
'We couldn't have achieved such a stellar recovery without the leadership of the Northern and Southern California Laborers Pension Funds. These Funds not only stepped forward to protect their participants' hard earned retirement savings, but equally important they committed themselves to the trial of this action, which allowed us to maximize the recovery for the class,' Luke Brooks said.
The settlement was achieved after six years of hard-fought litigation and an extensive investigation into all facets of defendants' securitization practices - a process that resulted in the production of more than 80 million pages of documents from defendants and third-parties, over 40 witness depositions, and consultation with experts in diverse and complex fields such as mortgage re-underwriting, securitization due diligence, statistics, and economics.
Robbins Geller also secured the cooperation of a critical whistleblower witness, which yielded key evidence in support of plaintiffs' claims, and obtained a class certification order that certified the most broadly-defined plaintiff class of any MBS class action to date.
The case is Fort Worth Employees' Retirement Fund v. JPMorgan Chase & Co. (U.S. District Court, Southern District of New York, No. 09-03701), currently pending before U.S. District Judge J. Paul Oetken in Manhattan.
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